Tax Extension: The October Deadline For Filing Your Return Is Almost Here
If you are among the roughly 19 million people who asked the IRS for another six months to file their taxes in 2022, time is almost up.
Almost 1 in 8 taxpayers asked for an extension to file their taxes this year, according to data from the IRS, which expects a total of about 160 million tax returns to be filed in 2022. While most Americans file their returns before the traditional April 15 deadline, people who needed more time were able to automatically receive another six months from the tax agency in order to get their files in order.
This year, the tax extension deadline for filing your 2021 return is October 17, rather than the typical date of October 15, because the 15th falls on a Saturday. Yet while that gives taxpayers a little more breathing room, experts have recommended filing as soon as possible in order to avoid last-minute pitfalls. They also recommend sending your return electronically, since the IRS has struggled mightily with processing paper returns during the pandemic.
“Using the electronic filing options can make people’s lives easier than mailing in paper tax returns,” said Eric Bronnenkant, head of tax at Betterment, told CBS MoneyWatch.
Typically, about 1 in 10 taxpayers asks for an extension, but this year may have seen a jump in requests for extra time because of the ongoing pandemic and the complexity of a tax year that included the enhanced Child Tax Credit and other tax changes.
Filing Information For Individual Income Tax
For those in a hurry, some quick links to everything you need to know about
Follow the links to sort out all the details quickly and make filing your tax return painless!
When Your Child Should File A Tax Return
Even if your child isn’t required to file an income tax return, it can still be a good idea to file if:
- Income taxes were withheld from earnings
- They qualify for the earned income credit
- They owe recapture taxes
- They want to open an IRA
- You want your child to gain the educational experience of filing taxes
In the first two cases, the main reason for filing would be to obtain a refund if one is due. The others are income-dependent or based on taking advantage of an opportunity to begin saving for retirement or to begin learning about personal finance.
Calendar Year Vs Fiscal Year
Keep in mind that there is a difference between the calendar year and fiscal year filing dates. The IRS defines a calendar year as of January 1 through December 31. It considers a fiscal year as 12 consecutive months ending on the last day of any month except December.
C corporations filing with a calendar year must file or extend their tax return by Those operating under a fiscal year system must file or extend the return on or before the 15th day of the fourth month after the close of your fiscal year.
Businesses can use either form of the tax year to determine annual income unless a certain type of tax year is required. Tax years are âadoptedâ by filing the initial tax form using that tax year. Once a particular tax year is chosen, you may need IRS approval in order to change it by filing IRS Form 1128.
Changing your tax year is fairly straightforward, but be sure youâve followed IRS regulations to do so. According to the IRS, the following actions do not constitute adopting a tax year:
- Filing an application for an Employer Identification Number
- Filing an application for a tax extension on an income tax return
- Paying estimated taxes for a tax year
Most businesses can adopt a calendar year, and there are situations in which adopting a calendar year is mandatory. These include:
- Lack of recordkeeping
What Could Cause A Refund Delay
There are countless reasons your tax refund could be delayed. Weve outlined some common instances where a delay could occur:
- If you file a paper return, the IRS says you should allow about six weeks to receive your refund.
- If the IRS mails you a physical check, you will receive a check through the mail.
- If you file Form 8379, Injured Spouse Allocation, it could take up to 14 weeks to process your tax return.
- If your identity has been stolen and another return was filed with your social security number, it could take longer for the IRS to sort out the situation.
- If you owe a debt, like unpaid child support, your refund could be offset to pay part or all of it.
Each of the possibilities above could cause a delay or prevent receiving the refund altogether. Its important to note that each individuals tax scenario is unique and no two filings are handled exactly the same.
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If You Opted Out Of Advance Payments
If you opted out of the advance payments before the first one was disbursed in July, claiming the credit on your return will likely be much simpler. When you file, you’ll simply confirm that you’re eligible for the credit and then claim the full amount you’re entitled to based on your 2021 income and number of qualifying dependents.
Will I Lose Out If I Didnt Sign Up In Time To Get A Payment On July 15
No. Everyone can receive the full Child Tax Credit benefits they are owed. If you signed up for monthly payments later in the year, your remaining monthly payments will be larger to reflect the payments you missed. If you do not sign-up in time for monthly payments in 2021, you will receive the full benefit when you file your tax return in 2022.
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Filing Your Taxes On The First Day With Turbotax & H& R Block
With online tax filing, you can file your taxes on the first day of tax season and get your refund back as soon as possible.
Existing customers will find it even easier as theyll be able to import last years returns. For those with simple tax affairs, itll take only a few minutes to begin preparing everything the IRS needs to file your tax return.
Not Knowing Who Takes The Tax Benefits For A Child
Some single parents assume that if their ex is taking the dependency exemption, the custodial parent cant take the earned income credit on the basis of that child.
This mistake can cause them to miss out on thousands of dollars per year of potential EIC, even in excess of tax they paid or had withheld from their paychecks.
The EIC is generally based on qualifying children you have living with you, regardless of which parent takes the dependency exemption.
Its often debatable who takes the dependency exemption for a child in cases where the parents are divorced or separated, or where someone else is supporting the family, such as a grandparent.
You know that you can usually take an exemption for your dependent children under age 19 who live with you. But you should also go through the questions in IRS Publication 17 to see if you can claim foster children, step-children, and grandchildren you support.
If you have children under 24 and attending school, you may still be able to claim them.
The child generally must live with you over half of the year, but this rule is easier to meet than you think.
Temporary absences for school or medical reasons dont count. If you are a noncustodial parent, special rules apply.
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Tips For Saving On Your Taxes
- A financial advisor can help you optimize your tax strategy for your familys needs. Finding a qualified financial advisor doesnt have to be hard. SmartAssets free tool matches you with up to three financial advisors who serve your area, and you can interview your advisor matches at no cost to decide which one is right for you. If youre ready to find an advisor who can help you achieve your financial goals, get started now.
- To make sure you dont miss a credit or deduction that you qualify for, use a good tax software. SmartAsset evaluated common tax filing services to find the best online tax software for your specific situation.
Irs Rules Regarding Your Age
As the table above indicates, individuals younger than age 65 must file if they make certain amounts. The earnings threshold amounts go up a bit for individuals 65 and up.
For married couples that file separate tax returns, the earnings target is based on the age of the older spouse.
In most situations, your age for tax purposes depends on how old you were on the last day of the year. But when it comes to determining whether you have to file a return, the IRS says that if you turned 65 on New Years Day, you are considered to be 65 at the end of the previous tax year. The one-day grace period allows you to use the higher-income thresholds to determine whether you must file a tax return.
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How To Claim The Ctc
There are two steps to signing up for the CTC. To get the advance payments, you had to file 2020 taxes or submitted your info to the IRS through the 2021 Non-filer portal or GetCTC.org. If you did not sign up for advance payments, you can still get the full credit by filing a 2021 tax return .
Even if you received monthly payments, you must file a tax return to get the other half of your credit. In January 2022, the IRS sent Letter 6419 that tells you the total amount of advance payments sent to you in 2021. You can either use this letter or your IRS account to find your CTC amount. On your 2021 tax return , you may need to refer to this notice to claim your remaining CTC. Learn more in this blog on Letter 6419.
Going to a paid tax preparer is expensive and reduces your tax refund. Luckily, there are free options available. You can visit GetCTC.org through November 15, 2022 to get the CTC and any missing amount of your third stimulus check. Use GetYourRefund.org by October 1, 2022 if you are also eligible for other tax credits like the Earned Income Tax Credit or the first and second stimulus checks.
Is Tax Filing Compulsory
If you donât owe taxes to the government, you may not need to file a tax return. However, there are other reasons why you may need to file a return and they include if:
- You are expecting a tax refund. Duh! CRA wonât chase you around if you donât owe them. If you want whatâs yours i.e. tax refund, you better go get it!
- You are eligible for and want to collect government benefits including GST/HST credits, Canada Child Benefit, GIS or Allowance benefits.
- You have an open Home Buyersâ Plan or Lifelong Learning Plan account through your RRSP.
- You are contributing to the Canada Pension Plan .
There are a few other scenarios where a tax return filing is required even if you do not owe taxes. If in doubt, just file there are many ways to do it for cheap, or even free.
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How Can I File My Taxes
The IRS accepts tax returns filed one of two ways:
A reported 88% of individual tax returns are e-filed per year. Any tax return filed by a tax professional in an H& R Block tax office, using the H& R Block tax software, or through the H& R Block online filing program is usually e-filed. However, you can always choose to have your return printed to mail yourself.
E-file is the quickest filing method and typically helps you receive a tax refund faster.
How To File Your Return
For accurate and efficient processing, the Department strongly recommends taxpayers use an electronic eFile option to file their returns.
For taxpayers filing using paper forms, you should send us
- Your North Carolina income tax return .
- Federal forms W-2 and 1099 showing the amount of North Carolina tax withheld as reported on Form D-400, Line 20.
- Federal Form 1099-R if you claimed a Bailey retirement deduction on Form D-400 Schedule S, Line 21.
- Form D-400 Schedule S if you added items to federal adjusted gross income on Form D-400, Line 7, or you deducted items from federal adjusted gross income on Form D-400, Line 9.
- Form D-400 Schedule A if you deducted N.C. itemized deductions on Form D-400, Line 11.
- Form D-400 Schedule PN if you entered a taxable percentage on Form D-400, Line 13.
- Form D-400 Schedule PN-1 if you entered an amount on Form D-400 Schedule PN, Part B, Line 17e or Line 19h.
- Form D-400TC and, if applicable, Form NC-478 and Form NC-Rehab if you claimed a tax credit on Form D-400, Line 16.
- A copy of the tax return you filed in another state or country if you claimed a tax credit for tax paid to another state or country on Form D-400TC, Line 7a.
- A copy of your federal tax return unless your federal return reflects a North Carolina address.
- Other required North Carolina forms or supporting schedules.
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Can I Still Contribute To My Retirement Fund
That depends whether you have a SEP IRA account, which stands for a “simplified employee pension” individual retirement account.
These are typically used by self-employed individuals, but are also common among small business owners. Under IRS rules, people with SEP IRA accounts can contribute to their accounts until the due date for filing their federal income tax return for the year, which means people who asked for an extension have until October 17 to sock away some money.
That can help self-employed workers or small business employees both save money and lower their taxable income for the 2021 tax year. However, the deadlines for contributing to IRA and 401 accounts have passed for people filing their 2021 tax returns via an extension.
Tips For Filing Your First Tax Return
One of the things you can do to make filing your taxes easier is to keep track of any money that you earn. And make note of any money your employer withholds from you to make your tax payments.
You should make sure that you keep any paychecks and invoices in an easy-to-locate place. You may need to submit these with your tax return.
If you are self-employed, keep detailed records of all purchases, payments, and expenses related to your business throughout the year.
Recommended Reading: Free Irs Approved Tax Preparation Courses
Or You Can Use Independent Computer Software Products
You can file both your Maryland and federal tax returns online using approved software on your personal computer. To use this method, youll need to know the correct county abbreviation for the Maryland county in which you live. You may need to enter the correct subdivision code for the city in Maryland in which you live.
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Schedule Federal Tax Payments Electronically
Taxpayers can file now and schedule their federal tax payments up to the October 17 due date. They can pay online, by phone or with their mobile device and the IRS2Go app. When paying federal taxes electronically, taxpayers should remember:
- Electronic payment options are the optimal way to make a tax payment.
- They can pay when they file electronically using tax software online. If using a tax preparer, taxpayers should ask the preparer to make the tax payment through an electronic funds withdrawal from a bank account.
- Online Account and IRS Direct Pay allow taxpayers to pay online directly from a checking or savings account for free, and to schedule payments up to 365 days in advance. Taxpayers should be aware they will need to create an account to use Online Account services.
- Choices to pay with a credit card, debit card or digital wallet option are available through a payment processor. The payment processor, not the IRS, charges a fee for this service.
- The IRS2Go mobile app provides mobile-friendly payment options, including Direct Pay and debit or credit card payments.
- The Electronic Federal Tax Payment System is convenient, safe and easy. Choose to pay online or by phone, using the EFTPS Voice Response System. EFTPS payments must be scheduled by 8 p.m. ET at least one calendar day before the tax due date.
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When Your Child Must File A Tax Return
Some people mistakenly believe their child’s status as a dependent means they don’t have to file taxes. But dependent child status does not excuse your child from filing an income tax return in certain situations. A child who meets any one of these tests for the 2021 tax year must file:
- If the child only has unearned income above $1,100
- If the child only has earned income above $12,550
- If the child has both earned and unearned income, and the child’s gross income is greater than either $12,550 or their earned income plus $350, whichever is less
- The child’s net earnings from self-employment are $400 or more
Additional rules apply for children who are blind, who owe Social Security and Medicare taxes on tips not reported to an employer or wages received from an employer who didn’t withhold taxes, or who receive wages from churches exempt from employer Social Security and Medicare taxes.
If filing a return is required by the first test above and the child has no other income besides unearned income, you can avoid filing a separate tax return for your child by making an election described later in this article.